BERKSHIRE HILLS BANCORP INC - Quarter Report: 2015 March (Form 10-Q)

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended: March 31, 2015

 

o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from                    to                  

 

Commission File Number: 001-15781

 

 

BERKSHIRE HILLS BANCORP, INC.

(Exact name of registrant as specified in its charter)

 

 

Registrant’s telephone number, including area code: (413) 443-5601

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes x  No o

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x  No o

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.  (Check one)

 

Large Accelerated Filer o        Accelerated Filer x       Non-Accelerated Filer o     Smaller Reporting Company o

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) Yes o  No x

 

The Registrant had 29,517,572 shares of common stock, par value $0.01 per share, outstanding as of May 6, 2015.

 

 

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BERKSHIRE HILLS BANCORP, INC.

FORM 10-Q

 

INDEX

 

				Page
PART I.	FINANCIAL INFORMATION
Item 1.	Consolidated Financial Statements (unaudited)
	Consolidated Balance Sheets as of March 31, 2015 and December 31, 2014			4
	Consolidated Statements of Operations for the Three Months Ended March 31, 2015 and 2014			5
	Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, 2015 and 2014			6
	Consolidated Statements of Changes in Stockholders’ Equity for the Three Months Ended March 31, 2015 and 2014			7
	Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2015 and 2014			8
	Notes to Consolidated Financial Statements
		Note 1	Basis of Presentation	10
		Note 2	Trading Security	12
		Note 3	Securities Available for Sale and Held to Maturity	13
		Note 4	Loans	17
		Note 5	Loan Loss Allowance	28
		Note 6	Deposits	32
		Note 7	Borrowed Funds	32
		Note 8	Stockholders’ Equity	33
		Note 9	Earnings per Share	36
		Note 10	Stock-Based Compensation Plans	36
		Note 11	Operating Segments	37
		Note 12	Derivative Financial Instruments and Hedging Activities	37
		Note 13	Fair Value Measurements	43
		Note 14	Net Interest Income after Provision for Loan Losses	51
		Note 15	Subsequent Events	51
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations			52
	Selected Financial Data			56
	Average Balances and Average Yields/Rates			57
	Non-GAAP Financial Measures			58
Item 3.	Quantitative and Qualitative Disclosures about Market Risk			68
Item 4.	Controls and Procedures			69

 

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PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	70
Item 1A.	Risk Factors	70
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	70
Item 3.	Defaults Upon Senior Securities	71
Item 4.	Mine Safety Disclosures	71
Item 5.	Other Information	71
Item 6.	Exhibits	71
Signatures		73

 

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PART I

ITEM 1.  CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

 

BERKSHIRE HILLS BANCORP, INC.

CONSOLIDATED BALANCE SHEETS

 

		March 31,			December 31,
(In thousands, except share data)		2015			2014
Assets
Cash and due from banks		$	43,089		$	54,179
Short-term investments		19,125			17,575
Total cash and cash equivalents		62,214			71,754
Trading security		14,970			14,909
Securities available for sale, at fair value		1,099,656			1,091,818
Securities held to maturity (fair values of $44,744 and $44,997)		42,818			43,347
Federal Home Loan Bank stock and other restricted securities		58,734			55,720
Total securities		1,216,178			1,205,794
Loans held for sale, at fair value		29,305			19,493
Residential mortgages		1,473,239			1,496,204
Commercial real estate		1,672,099			1,611,567
Commercial and industrial loans		826,815			804,366
Consumer loans		756,510			768,463
Total loans		4,728,663			4,680,600
Less: Allowance for loan losses		(36,286		)	(35,662		)
Net loans		4,692,377			4,644,938
Premises and equipment, net		85,053			87,279
Other real estate owned		1,444			2,049
Goodwill		264,742			264,742
Other intangible assets		10,627			11,528
Cash surrender value of bank-owned life insurance policies		105,302			104,588
Deferred tax assets, net		26,828			28,776
Other assets		77,169			61,090
Total assets		$	6,571,239		$	6,502,031
Liabilities
Demand deposits		$	892,225		$	869,302
NOW deposits		436,458			426,108
Money market deposits		1,372,924			1,407,179
Savings deposits		512,607			496,344
Time deposits		1,505,469			1,455,746
Total deposits		4,719,683			4,654,679
Short-term debt		894,500			900,900
Long-term Federal Home Loan Bank advances		61,618			61,676
Subordinated borrowings		89,765			89,747
Total borrowings		1,045,883			1,052,323
Other liabilities		89,443			85,742
Total liabilities		5,855,009			5,792,744
Stockholders’ equity
Common stock ($.01 par value; 50,000,000 shares authorized and 26,525,466 shares issued and 25,252,635 shares outstanding in 2015; 26,525,466 shares issued and 25,182,566 shares outstanding in 2014)		265			265
Additional paid-in capital		585,307			587,289
Unearned compensation		(7,226		)	(6,147		)
Retained earnings		160,241			156,446
Accumulated other comprehensive income (loss)		9,068			6,579
Treasury stock, at cost (1,272,831 shares in 2015 and 1,342,900 shares in 2014)		(31,425		)	(33,145		)
Total stockholders’ equity		716,230			709,287
Total liabilities and stockholders’ equity		$	6,571,239		$	6,502,031

 

The accompanying notes are an integral part of these consolidated financial statements.

 

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BERKSHIRE HILLS BANCORP, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

 

		Three Months Ended
		March 31,
(In thousands, except per share data)		2015			2014
Interest and dividend income
Loans		$	44,445		$	42,494
Securities and other		8,306			7,301
Total interest and dividend income		52,751			49,795
Interest expense
Deposits		4,949			4,721
Borrowings		2,309			2,308
Total interest expense		7,258			7,029
Net interest income		45,493			42,766
Non-interest income
Loan related income		1,283			1,248
Mortgage banking income		1,253			372
Deposit related fees		5,677			5,439
Insurance commissions and fees		2,967			3,049
Wealth management fees		2,603			2,549
Total fee income		13,783			12,657
Other		(1,255		)	524
Gain on sale of securities, net		34			34
Loss on termination of hedges		—			(8,792		)
Total non-interest income		12,562			4,423
Total net revenue		58,055			47,189
Provision for loan losses		3,851			3,396
Non-interest expense
Compensation and benefits		21,811			19,859
Occupancy and equipment		7,108			6,814
Technology and communications		3,593			3,778
Marketing and promotion		713			521
Professional services		1,272			1,152
FDIC premiums and assessments		1,129			1,009
Other real estate owned and foreclosures		251			523
Amortization of intangible assets		901			1,306
Acquisition, restructuring and conversion related expenses		4,421			6,301
Other		3,949			4,097
Total non-interest expense		45,148			45,360
Income before income taxes		9,056			(1,567		)
Income tax expense (benefit)		297			(461		)
Net income (loss)		$	8,759		$	(1,106	)
Earnings per share:
Basic		$	0.35		$	(0.04	)
Diluted		$	0.35		$	(0.04	)
Weighted average common shares outstanding:
Basic		24,803			24,698
Diluted		24,955			24,698

 

The accompanying notes are an integral part of these consolidated financial statements.

 

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BERKSHIRE HILLS BANCORP, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

 

		Three Months Ended
		March 31,
(In thousands)		2015			2014
Net income (loss)		$	8,759		$	(1,106	)
Other comprehensive income, before tax:
Changes in unrealized gain on securities available-for-sale		9,337			6,021
Changes in unrealized (loss) gain on derivative hedges		(3,901		)	4,533
Changes in unrealized gain on terminated swaps		—			3,237
Changes in unrealized (loss) gain on pension		(1,531		)	—
Income taxes related to other comprehensive income:
Changes in unrealized gain on securities available-for-sale		(3,605		)	(2,221		)
Changes in unrealized (loss) gain on derivative hedges		1,572			(1,832		)
Changes in unrealized gain on terminated swaps		—			(1,312		)
Changes in unrealized (loss) gain on pension		617			—
Total other comprehensive income		2,489			8,426
Total comprehensive income		$	11,248		$	7,320

 

The accompanying notes are an integral part of these consolidated financial statements.

 

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BERKSHIRE HILLS BANCORP, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

 

																Accumulated
							Additional									other
		Common stock					paid-in			Unearned			Retained			comprehensive			Treasury
(In thousands)		Shares		Amount			capital			compensation			earnings			(loss) income			stock			Total
Balance at December 31, 2013		25,036		$	265		$	587,247		$	(5,563	)	$	141,958		$	(9,057	)	$	(36,788	)	$	678,062
Comprehensive income:
Net loss		—		—			—			—			(1,106		)	—			—			(1,106		)
Other comprehensive income		—		—			—			—			—			8,426			—			8,426
Total comprehensive income																						7,320
Cash dividends declared ($0.18 per share)		—		—			—			—			(4,561		)	—			—			(4,561		)
Treasury stock purchased		(100	)	—			—			—			—			—			(2,467		)	(2,467		)
Forfeited shares		(1	)	—			1			5			—			—			(6		)	—
Exercise of stock options		61		—			—			—			(793		)	—			1,512			719
Restricted stock grants		126		—			37			(3,144		)	—			—			3,107			—
Stock-based compensation		—		—			41			891			—			—			—			932
Net tax benefit related to stock-based compensation		—		—			(1,984		)	—			—			—			—			(1,984		)
Other, net		(17	)	—			—			—			—			—			(431		)	(431		)
Balance at March 31, 2014		25,105		$	265		$	585,342		$	(7,811	)	$	135,498		$	(631	)	$	(35,073	)	$	677,590
Balance at December 31, 2014		25,183		$	265		$	585,289		$	(6,147	)	$	156,446		$	6,579		$	(33,145	)	$	709,287
Comprehensive income:
Net income		—		—			—			—			8,759			—			—			8,759
Other comprehensive income		—		—			—			—			—			2,489			—			2,489
Total comprehensive income																						11,248
Cash dividends declared ($0.19 per share)		—		—			—			—			(4,799		)	—			—			(4,799		)
Treasury stock purchased		—		—			—			—			—			—			—			—
Forfeited shares		(9	)	—			22			214			—			—			(236		)	—
Exercise of stock options		11		—			—			—			(165		)	—			281			116
Restricted stock grants		92		—			19			(2,286		)	—			—			2,267			—
Stock-based compensation		—		—			—			993			—			—			—			993
Net tax benefit related to stock-based compensation		—		—			(23		)	—			—			—			—			(23		)
Other, net		(24	)	—			—			—			—			—			(592		)	(592		)
Balance at March 31, 2015		25,253		$	265		$	585,307		$	(7,226	)	$	160,241		$	9,068		$	(31,425	)	$	716,230

 

The accompanying notes are an integral part of these consolidated financial statements.

 

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BERKSHIRE HILLS BANCORP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

		Three Months Ended March 31,
(In thousands)		2015			2014
Cash flows from operating activities:
Net income (loss)		$	8,759		$	(1,106	)
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses		3,851			3,396
Net amortization of securities		(317		)	604
Change in unamortized net loan costs and premiums		398			64
Premises and equipment depreciation and amortization expense		2,096			1,944
Stock-based compensation expense		993			932
Accretion of purchase accounting entries, net		(367		)	(1,999		)
Amortization of other intangibles		901			1,306
Write down of other real estate owned		—			125
Excess tax loss from stock-based payment arrangements		23			(89		)
Income from cash surrender value of bank-owned life insurance policies		(714		)	(813		)
Gain on sales of securities, net		(34		)	(34		)
Net (increase) decrease in loans held for sale		(9,812		)	8,171
Loss on disposition of assets		1,136			834
Loss on sale of real estate		154			208
Loss on termination of hedges		—			3,237
Amortization of interest in tax-advantaged projects		2,882			421
Net change in other		(6,145		)	(183		)
Net cash provided by operating activities		3,804			17,018
Cash flows from investing activities:
Net decrease in trading security		142			135
Proceeds from sales of securities available for sale		4,693			3,171
Proceeds from maturities, calls and prepayments of securities available for sale		40,552			25,440
Purchases of securities available for sale		(41,068		)	(291,662		)
Proceeds from maturities, calls and prepayments of securities held to maturity		729			1,762
Purchases of securities held to maturity		(200		)	—
Net change in loans		(68,671		)	(59,851		)
Purchases of bank owned life insurance		—			—
Proceeds from sale of Federal Home Loan Bank stock		103			78
Purchase of Federal Home Loan Bank stock		(3,117		)	(2,920		)
Net investment in limited partnership tax credits		—			(2,500		)
Proceeds from the sale of premises and equipment		—			—
Purchase of premises and equipment, net		(946		)	(3,130		)
Acquisitions, net of cash paid		—			423,416
Proceeds from sale of other real estate		578			483
Net cash (used in) provided by investing activities		(67,205		)	94,422
(continued)

 

The accompanying notes are an integral part of these consolidated financial statements.

 

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BERKSHIRE HILLS BANCORP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (CONCLUDED)

 

		Three Months Ended March 31,
(In thousands)		2015			2014
Cash flows from financing activities:
Net increase (decrease) in deposits		65,007			(70,422		)
Proceeds from Federal Home Loan Bank advances and other borrowings		2,200,000			900,018
Repayments of Federal Home Loan Bank advances and other borrowings		(2,206,440		)	(937,682		)
Purchase of treasury stock		—			(2,467		)
Exercise of stock options		116			719
Excess tax loss from stock-based payment arrangements		(23		)	89
Common stock cash dividends paid		(4,799		)	(4,561		)
Net cash provided (used) by financing activities		53,861			(114,306		)
Net change in cash and cash equivalents		(9,540		)	(2,866		)
Cash and cash equivalents at beginning of year		71,754			75,539
Cash and cash equivalents at end of year		$	62,214		$	72,673
Supplemental cash flow information:
Interest paid on deposits		$	4,902		$	4,718
Interest paid on borrowed funds		2,306			3,145
Income taxes paid, net		274			146
Acquisition of non-cash assets and liabilities:
Assets acquired		—			18,064
Liabilities assumed		—			(441,550		)
Other non-cash changes:
Other net comprehensive income		2,489			5,189
Real estate owned acquired in settlement of loans		127			476

 

The accompanying notes are an integral part of these consolidated financial statements.

 

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NOTE 1.                                              BASIS OF PRESENTATION

 

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and contain all adjustments, consisting solely of normal, recurring adjustments, necessary for a fair presentation of results for such periods.

 

In addition, these interim financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X, and accordingly, certain information and footnote disclosures normally included in financial statements prepared according to U.S. GAAP have been omitted.

 

The results for any interim period are not necessarily indicative of results for the full year. These consolidated financial statements should be read in conjunction with the audited financial statements and note disclosures for Berkshire Hills Bancorp, Inc. (the “Company”) previously filed with the Securities and Exchange Commission in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014.

 

Reclassifications

 

Certain items in prior financial statements have been reclassified to conform to the current presentation.

 

Recently Adopted Accounting Standards

 

In January 2014, the Financial Accounting Standard Board “FASB” issued Accounting Standard Updated “ASU” ASU No. 2014-01, “Accounting for Investments in Qualified Affordable Housing Projects.” ASU No. 2014-01 permits reporting entities to make an accounting policy election to account for investments in qualified affordable housing projects using the proportional amortization method if certain conditions are met. Under the proportional amortization method, an entity amortizes the initial cost of the investment in proportion to the tax credits and other tax benefits received and recognizes the net investment performance in the income statement as a component of income tax expense. This new guidance also requires new disclosures for all investors in these projects. ASU No. 2014-01 is effective for interim and annual reporting periods beginning after December 15, 2014. Upon adoption, the guidance must be applied retrospectively to all periods presented. However, entities that use the effective yield method to account for investments in these projects before adoption may continue to do so for these pre-existing investments. The Company has elected not to adopt the proportional amortization method, which had no impact on our consolidated financial statements.

 

Also in January 2014, the FASB issued ASU No. 2014-04, “Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure.” The objective of this guidance is to clarify when an in substance repossession or foreclosure occurs, that is, when a creditor should be considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan such that the loan receivable should be derecognized and the real estate property recognized. ASU No. 2014-04 states that an in substance repossession or foreclosure occurs, and a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan, upon either (1) the creditor obtaining legal title to the residential real estate property upon completion of a foreclosure or (2) the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. Additionally, ASU No. 2014-04 requires interim and annual disclosure of both (1) the amount of foreclosed residential real estate property held by the creditor and (2) the recorded investment in consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure according to local requirements of the applicable jurisdiction. ASU No. 2014-04 is effective for interim and annual reporting periods beginning after December 15, 2014. The Company adopted the provisions of ASU No. 2014-04 effective January 1, 2015, which did not have a material effect on our consolidated financial statements.  See Note 4 - Loans to the Consolidated Financial Statements for the disclosures required by ASU No. 2014-04.

 

In June 2014, the FASB issued ASU No. 2014-11 related to repurchase-to-maturity transactions, repurchase financing and disclosures. The pronouncement changes the accounting for repurchase-to-maturity transactions and linked repurchase financings to secured borrowing accounting, which is consistent with the accounting for other

 

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repurchase agreements. The pronouncement also requires two new disclosures. The first disclosure requires an entity to disclose information on transfers accounted for as sales in transactions that are economically similar to repurchase agreements. The second disclosure provides increased transparency about the types of collateral pledged in repurchase agreements and similar transactions accounted for as secured borrowings. The pronouncement is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2014. Early adoption is not permitted. As of March 31, 2015 the Company did not have any repurchase transactions, and therefore the adoption of this pronouncement did not have an impact on our consolidated financial statements.

 

In August 2014, the FASB issued ASU No. 2014-14 related to classification of certain government-guaranteed mortgage loans upon foreclosure. The objective of this guidance is to reduce diversity in practice related to how creditors classify government-guaranteed mortgage loans, including FHA or VA guaranteed loans, upon foreclosure. Some creditors reclassify those loans to real estate consistent with other foreclosed loans that do not have guarantees; others reclassify the loans to other receivables. The amendments in this guidance require that a mortgage loan be derecognized and that a separate other receivable be recognized upon foreclosure if the following conditions are met: (1) The loan has a government guarantee that is not separable from the loan before foreclosure; (2) At the time of foreclosure, the creditor has the intent to convey the real estate property to the guarantor and make a claim on the guarantee, and the creditor has the ability to recover under that claim; and (3) At the time of foreclosure, any amount of the claim that is determined on the basis of the fair value of the real estate is fixed. Upon foreclosure, the separate other receivable should be measured based on the amount of the loan balance (principal and interest) expected to be recovered from the guarantor. The pronouncement is effective for interim and annual reporting periods beginning after December 15, 2014. The Company adopted the provisions of ASU No. 2014-14 effective January 1, 2015, which did not have a material effect on our consolidated financial statements.

 

Future Application of Accounting Pronouncements

 

In May 2014, the FASB issued ASU No. 2014-09 related to the recognition of revenue from contracts with customers. The new revenue pronouncement creates a single source of revenue guidance for all companies in all industries and is more principles-based than current revenue guidance. The pronouncement provides a five-step model for a company to recognize revenue when it transfers control of goods or services to customers at an amount that reflects the consideration to which it expects to be entitled in exchange for those goods or services. The five steps are (1) identify the contract with the customer, (2) identify the separate performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the separate performance obligations and (5) recognize revenue when each performance obligation is satisfied. The pronouncement is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2016 using either a full retrospective approach for all periods presented in the period of adoption or a modified retrospective approach. Early adoption is not permitted. The adoption of this pronouncement is not expected to have a material impact on our consolidated financial statements.

 

In February 2015, the FASB issued ASU No. 2015-02, “Amendments to the Consolidation Analysis.” This ASU affects reporting entities that are required to evaluate whether they should consolidate certain legal entities. Specifically, the amendments: (1) Modify the evaluation of whether limited partnerships and similar legal entities are variable interest entities (“VIEs”) or voting interest entities; (2) Eliminate the presumption that a general partner should consolidate a limited partnership; (3) Affect the consolidation analysis of reporting entities that are involved with VIEs, particularly those that have fee arrangements and related party relationships; and (4) Provide a scope exception from consolidation guidance for reporting entities with interests in legal entities that are required to comply with or operate in accordance with requirements that are similar to those in Rule 2a-7 of the Investment Company Act of 1940 for registered money market funds. ASU No. 2015-02 is effective for interim and annual reporting periods beginning after December 15, 2015. Early adoption is not permitted; however, the FASB has issued a proposal to extend the effective date by one year.

 

In April 2015, the FASB issued ASU No. 2015-05, “Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement.” This ASU provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a

 

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cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The new guidance does not change the accounting for a customer’s accounting for service contracts. ASU No. 2015-05 is effective for interim and annual reporting periods beginning after December 15, 2015. The adoption of this pronouncement is not expected to have a material impact on our consolidated financial statements.

 

NOTE 2.                                              TRADING SECURITY

 

The Company holds a tax advantaged economic development bond that is being accounted for at fair value. The security had an amortized cost of $12.4 million and $12.6 million, and a fair value of $15.0 million and $14.9 million, at March 31, 2015 and December 31, 2014, respectively. As discussed further in Note 12 - Derivative Financial Instruments and Hedging Activities, the Company has entered into a swap contract to swap-out the fixed rate of the security in exchange for a variable rate. The Company does not purchase securities with the intent of selling them in the near term, and there are no other securities in the trading portfolio at March 31, 2015.

 

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Table of Contents

 

NOTE 3. SECURITIES AVAILABLE FOR SALE AND HELD TO MATURITY

 

The following is a summary of securities available for sale and held to maturity:

 

(In thousands)		Amortized Cost			Gross Unrealized Gains			Gross Unrealized Losses			Fair Value
March 31, 2015
Securities available for sale
Debt securities:
Municipal bonds and obligations		$	149,454		$	6,391		$	(395	)	$	155,450
Government-guaranteed residential mortgage-backed securities		64,456			696			(113		)	65,039
Government-sponsored residential mortgage-backed securities		750,730			13,157			(1,466		)	762,421
Corporate bonds		55,560			411			(614		)	55,357
Trust preferred securities		12,773			736			(82		)	13,427
Other bonds and obligations		3,203			—			(7		)	3,196
Total debt securities		1,036,176			21,391			(2,677		)	1,054,890
Marketable equity securities		38,150			7,536			(920		)	44,766
Total securities available for sale		1,074,326			28,927			(3,597		)	1,099,656
Securities held to maturity
Municipal bonds and obligations		4,847			—			—			4,847
Government-sponsored residential mortgage-backed securities		70			5			—			75
Tax advantaged economic development bonds		37,570			1,921			—			39,491
Other bonds and obligations		331			—			—			331
Total securities held to maturity		42,818			1,926			—			44,744
Total		$	1,117,144		$	30,853		$	(3,597	)	$	1,144,400
December 31, 2014
Securities available for sale
Debt securities:
Municipal bonds and obligations		$	127,014		$	6,859		$	(174	)	$	133,699
Government-guaranteed residential mortgage-backed securities		68,972			702			(206		)	69,468
Government-sponsored residential mortgage-backed securities		755,893			7,421			(3,130		)	760,184
Corporate bonds		55,134			120			(1,103		)	54,151
Trust preferred securities		16,607			820			(1,212		)	16,215
Other bonds and obligations		3,211			—			(52		)	3,159
Total debt securities		1,026,831			15,922			(5,877		)	1,036,876
Marketable equity securities		48,993			7,322			(1,373		)	54,942
Total securities available for sale		1,075,824			23,244			(7,250		)	1,091,818
Securities held to maturity
Municipal bonds and obligations		4,997			—			—			4,997
Government-sponsored residential mortgage-backed securities		70			4			—			74
Tax advantaged economic development bonds		37,948			1,680			(34		)	39,594
Other bonds and obligations		332			—			—			332
Total securities held to maturity		43,347			1,684			(34		)	44,997
Total		$	1,119,171		$	24,928		$	(7,284	)	$	1,136,815

 

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